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Tesla slashes car prices prompting backlash from existing owners

 (Bloomberg via Getty Images)
(Bloomberg via Getty Images)

Tesla has begun slashing the prices of its electric vehicles in Europe and the US in a bid drive up sales amid dwindling consumer demand, sparking fury from existing owners.

Prices of the carmakers Model 3 Performance vehicle were cut by 14.3% in the US, according figures from Reuters, while the price of the Model Y Rear Wheel Drive vehicle was reduced by 16.8% in Germany.

The cuts have prompted a backlash from some owners of the cars, with Tesla drivers posting in online forums that they felt short-changed by having to fork out thousands of euros more for the same vehicles because they bought them before the discounts. Earlier this week, owners protested outside delivery centres in China demanding compensation for the higher prices they paid, after the carmaker cut prices in the territory by up to 13.5% earlier this month.

Tesla said it had no plans for issuing compensation.

The EV maker, run by billionaire Elon Musk, has seen its stock price plunge 64% in the past year, wiping more than half a trillion dollars from its market cap. Tesla shares took another tumble last week, diving more than 12% to hit their lowest level in over two years after the carmaker’s 2022 delivery numbers fell short of targets.

Some investors have expressed frustration over Musk’s decision to devote more of his time to running social media site Twitter, which he bought last year.

Tony Sycamore, an analyst at brokerage IG Markets, told the Reuters news agency the focus on Twitter “doesn’t put a lot of confidence in the business, or speak volumes for where his attention is at,” adding “it’s not a good situation.”

Musk has defended his time spent running Twitter, writing in a Tweet: “I continue to oversee both Tesla & SpaceX, but the teams there are so good that often little is needed from me.”

He later added: “I will make sure Tesla shareholders benefit from Twitter long-term.”

The dwindling stock price has meant Musk has now ceased to be the richest person in the world, according to Forbes, being replaced by the French boss of LVMH, Bernard Arnault.